FAROE Petroleum chief executive Graham Stewart has said the company wants to remain independent amid speculation its biggest shareholder, DNO, will launch a hostile takeover bid for the firm after failing to trigger a boardroom shake up.

Aberdeen-based Faroe became embroiled in a bitter war of words with DNO recently after the Norwegian firm tried to get two if its director appointed to the board.

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Aim-listed Faroe said the attempt was wholly self-serving and part of an undisclosed strategy on DNO’s part to try and gain control of the company.

DNO had said in April that it did not intend to make an offer for Faroe after revealing that it had acquired a 15.4 per cent stake in the firm, which it increased to 28.7% that month.

DNO subsequently shelved its call for a shareholder vote on the board reform expressing deep disappointment at what it described as Faroe’s “repeated peremptory and disdainful attitude” to its proposal.

The company said on August 27 that it would not pursue a meeting of shareholders while it considered its position and has remained silent since.

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After Faroe Petroleum posted £72.9 million first half profits yesterday, Mr Stewart told Reuters: “Our desire is to continue as an independent company.”

Mr Stewart said Faroe had a constructive meeting with DNO last week. Another one is scheduled for next week.

Faroe declined to elaborate on what was discussed at last week’s meeting, which was attended by senior independent director Brent Cheshire.

DNO made no comment yesterday.

Analysts at Arden Partners noted DNO would be free to make an offer for Faroe from October 4, when the six month bar on it making a bid under the Takeover Code will expire.

“We expect this to be a focus for the market in the coming weeks,” noted the brokerage, adding: “Our view remains that any bid would need to be at a premium to current levels in order to have a chance of succeeding.”

Mr Stewart said Faroe had made good progress in the six months to June 30 and is well placed to achieve its ambitious growth targets.

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“I remain confident in our ability to deliver our stated near to medium term production growth target of 35,000 boepd (barrels oil equivalent per day) and wish to express my sincere gratitude to all our stakeholders for their ongoing support,” he said.

Faroe produced an average 12,402 boepd in the first half compared with 14,800 boepd.

Production was impacted by upgrade work on one field off Norway and issues with the export facilities used by another.

However, the company achieved a big increase in profitability, helped by the increase in the crude price during the period. Faroe lost £6.1m before tax in the first half last year.

Mr Stewart said the Iris Hades find made in April was Faroe’s largest discovery to date and added an estimated 42 million barrels oil equivalent to its resource base.

If appraisal drilling confirms the potential of the find it could be added to a hopper of development projects. that includes a number of fields off Norway.

Mr Stewart said the company is taking full advantage of the material fall in the cost of services seen in the wake of the crude price plunge between 2014 and 2016 to pursue its largest ever investment programme.

Faroe has focused drilling activity in Norwegian waters in recent years. The country offers generous tax breaks for exploration.

But the company showed faith in the potential of the UK North Sea last month by agreeing to join Cairn Energy and Azinor Catalyst in drilling off Shetland.

Faroe has a strong balance sheet leaving it well placed to make further acquisitions. It bought a stake in the producing Blane field off Scotland in July last year from JX Nippon for around £4m.